There is no empirical evidence that trade exposure per se increases child labour. As trade theory and household economics lead us to expect, the cross-country evidence seems to indicate that trade reduces or, at worst, has no significant effect on child labour. Consistently with the theory, a...

The skeptics of globalization argue that increased trade openness and foreign direct investment induce developing countries to keep labor costs low, for example by letting children work. This article argues that there are good theoretical reasons why globalization might actually have the...